Worker’s compensation is probably one of the oldest types of insurance programs within the United States. Because of the incredibly rapid demand for industrial jobs during the early twentieth century, injuries occurring in the workplace became a very common thing and the risks involved working in factories at the time were more apparent and was something every factory was actively aware of and trying to avoid; especially workers who were surrounded by heavy machinery.

At the time, getting seriously injured in a factory was practically a death sentence. There was no set procedures on how to deal with injuries and the injured worker would be out of a job since they’d be physically incapable of continuing work there or in other factories. The ensuing medical bills and lost wages would eventually bury the injured party in enough financial problems to ruin their life.

Some workers who sustained injuries in the workplace would try suing their employer but these would rarely produce any favorable results and caused even more problems in the workplace as it strained employee/employer relationships all around. There were 3 popular defenses used any time employers would deal with lawsuits related to injuries, these were:

Contributory negligence

The injury sustained was caused by an accident because of negligence

Assumption of risk

That the injury is a real danger involved in that job and the fact that you take the job means you understand and accept the risks involved

Fellow worker rule

The injury was the result of a co-worker’s negligence so the employer should not be answerable.

It was clearly unfair and workers who were fighting the unbalanced system, almost always had to wait a long time for any kind of financial compensation. The long wait, coupled with lawyer’s fees and the inability to work wreaked havoc in many lives.

It wasn’t until 1908 that the United States passed its first worker’s compensation law which has been, thankfully, tweaked and improved consistently leading up to what we have today.

Today, thanks to worker’s compensation laws, workers who are injured during their job are given a predetermined amount of financial compensation and benefits which can be passed on to their families if their injury results in death.

Another benefit of this program is that injured worker’s no longer need to endure lengthy lawsuits and receives guaranteed benefits. Based on the idea of ‘compensation bargain’, injured workers forfeit the rights to sue their employers so they can receive due compensation.

There are over 50 kinds of state-run worker compensation programs and each one varies when it comes to compensation, benefits, and coverage. It is required by law for all employers to have worker’s compensation insurance coverage. Commonly covered items include:

Medical expenses

Large percentage of lost earnings

Potential future earnings

Specialized training for a new job or physical therapy

In the event of death, funeral expenses will be paid for and family members may be eligible for wage-replacement benefits. Financial compensation for medical expenses and cash benefits are usually received within 3 days to a week from the time of injury.